Jim Cramer warns SpaceX could soar to unsustainable levels after its debut

On Thursday, CNBC's Jim Cramer expressed concerns regarding the possibility of SpaceX's stock price skyrocketing following its market debut. He warned, "If things take a turn, we might witness SpaceX becoming the largest stock globally." As Elon Musk's aerospace and AI enterprise prepares to commence trading on Friday, it has set an initial share price of $135, leading to a staggering valuation of $1.77 trillion. The enthusiasm for this initial public offering (IPO) is palpable, with reports indicating that it has been oversubscribed by four times. While such overwhelming interest is generally seen as a positive indicator, Cramer cautioned that it could lead to complications. He believes that the most successful IPOs typically see a modest opening above their initial price, followed by a stable trading period. However, SpaceX's unique combination of institutional interest, retail excitement, and anticipated index purchases could drive its shares to spike dramatically right from the start. Cramer specifically highlighted his worry about inexperienced investors placing market orders instead of limit orders, which could lead to unsustainable price levels. He described these buyers as "unguided missiles" that could disrupt the market. Should a rush of buyers occur simultaneously, he predicts that SpaceX's valuation might briefly reach heights comparable to the world's leading public companies. However, he emphasized that such rapid increases rarely result in positive outcomes. "Is it feasible to see a stock valued at $4 to $5 trillion? Perhaps for a fleeting moment, but if it isn't quickly stabilized, it could lead to disaster," he remarked. He referenced recent IPOs like Figma and Cerebras, which initially soared before experiencing significant declines. Ultimately, Cramer advocates for a well-managed market debut rather than a spectacular initial surge. He believes controlled growth is essential for long-term value. "We need to keep these deals under control, or the aftermath can be catastrophic," he concluded.